No one fears the “fiscal cliff.” On Sept. 29, 2008, the Democratic House failed to pass TARP. The Dow Jones Index ended the day down 777 points. On July 27, 2011, one of the days when Boehner’s Republicans punted on a debt deal, the Dow plunged 199 points. The markets haven’t responded to the “fiscal cliff” this way. Stock prices are generally up since the Nov. 6 election. On Thursday night, I asked outgoing House Rules Chairman David Dreier why that was.

“I follow the market very, very closely,” he said. “I follow it throughout the day. There is a sense that something is going to get done, and from people I talk to in the market, in that business. It stops being true by the end of next week. But there’s a possibility we go over and we’re able to come back. The market reaction wouldn’t be very positive, but as long as there’s an end in sight, if it happens in mid-January—it depends on the details.”

The Standard & Poor’s 500 index (SPY) and Dow Jones Industrial Average (DIA) are both down about 1% right now — not good, but nothing to panic about, and both indexes are still up about 1% this month.

Even the Vix, which jumped 13% earlier today, has moderated, now up about 5% to 18.5 — higher for the day, but not the make-or-break level it looked to be heading towards this morning.

As Dreier admits, things could get a whole lot worse. But whether you want to call it complacency, common sense or plain naivete, the markets are operating on the assumption that things will, eventually, work themselves out.

For those hungry for more context, here are our cousins at WSJ’s Washington, DC, bureau talking about the latest developments:

About Stocks To Watch

Earnings reports, corporate strategies and analyst insights are all part of what moves stocks, and they’re all covered by the Stocks to Watch blog. We also look at macro issues, investor sentiments and hidden trends that are affecting the market. Stocks to Watch gives you the full picture of the U.S. stock markets, all day long.

The blog is written by Ben Levisohn, a former stock trader who has covered financial markets for the Wall Street Journal, Bloomberg and BusinessWeek.